St. Louis Park leaders approved the purchase of land from Hennepin County to support the proposed PLACE mixed-use development near Wooddale Avenue and a planned light rail line.
The St. Louis Park Economic Development Authority, made up of council members, voted 6-1 April 3 to buy four parcels of land for $1.1 million to accommodate the PLACE project. The council planned to discuss approvals for the project itself April 17.
The purchases would support the PLACE project on parcels located at 3520 Yosemite Ave., 3565 Wooddale Ave. and a western portion of 3548 Xenwood Ave.
“The plan is that three of the four parcels would subsequently be sold to PLACE as part of the property assemblage for its proposed mixed-use redevelopment adjacent to the Wooddale Station,” said Greg Hunt, economic development coordinator, of a station proposed as part of the Southwest Light Rail Transit line.
The city plans to use the fourth parcel, at 3524 Yosemite Ave., for right-of-way purposes. The Economic Development Authority plans to keep the eastern portion of the parcel at 3548 Xenwood Ave. for future redevelopment purposes.
A city staff report states, “Regardless of whether the proposed PLACE project proceeds, the EDA has provided direction to acquire the subject parcels so as to assemble sites large enough to spur redevelopment on either side of the future [Southwest Light Rail Transit] Wooddale Station.”
Commissioner Sue Sanger, who voted against the purchases, said, “I firmly agree that the idea of purchasing and assembling these properties would be very beneficial for redevelopment in the area. However, I am not going to support the purchase of these properties at this time because I know the intended purpose of this is to turn around and make them part of the PLACE project, which is not a project which I am supporting.”
Hunt said that if the PLACE project did not receive final city approvals, the city would seek another redeveloper to build on the land.
PLACE seeks city financial help
Leaders of PLACE, a Minneapolis-based nonprofit developer, have asked St. Louis Park officials to approve nearly $5.7 million in tax-increment
financing over 15 years to offset some of the costs of the $123 million project.
With tax-increment financing, new taxes generated by a development are returned to a developer to pay for qualifying costs like site acquisition and infrastructure upgrades.
The city council has scheduled a public hearing on the tax-increment financing request at a meeting 7:30 p.m. Monday, May 1.
The project would include 299 residential units, 200 of which would be classified as affordable; a 110-room hotel; a facility that would serve as a greenhouse and generate power through an anaerobic digester using biodegradable material for fuel; more than 16,000 square feet of commercial and retail space; and a one-acre urban forest.
The council has also anticipated the approval of more than $27 million in tax-exempt bonds for the project.
In December, the council authorized PLACE to seek $55 million in multifamily housing bond funds from the state. However, the state approved about half of the amount instead due to a high demand for such bonds.
The level the state approved is still large enough to allow the project to quality for low-income housing tax credits, though, according to a city staff report. Allianz Life Insurance Co. of North America would purchase the project’s tax credits, providing equity for the housing project.
The council set a public hearing on the bonds April 17, after this edition went to press. PLACE would pay an administrative fee to the city valued over the life of the bonds at about $452,000 at the current value of the dollar. The city would not be obligated to cover any of the repayment costs of the bond.
Councilmember Anne Mavity said at a March 20 council meeting, “I think that with the challenges ahead on the financing, the city should be doing everything it can to facilitate this, with all the investing that’s been done to date. These are not easy deals, and I think there remains a lot of risk involved in this and trying to make this happen, and I think the city’s ability to help facilitate it and help move it forward – at no financial risk to itself at this point – is in the interests of all of us.”
Contact Seth Rowe at [email protected]